Select the action from the

options below that will NOT apply to a secondary external stakeholder group

attempting to influence the strategy of an organisation

(a) 

(b) 

(c)  

An increase of the interest

rate on a loan agreement or denial of credit to an organisation when a specific

organisation does not comply with their loan agreement due to cash flow

constraints.

(d) 

Dice Pizzerias (Pty) Ltd

bought a top of the range pizza oven from MetaMasters

(Pty) Ltd. MetaMasters granted a loan to Dice Pizzerias for the purchase and a

contract was signed between the two parties stipulating the conditions,

interest rate, instalment amount, payment frequency and the period of the

agreement.

a)  Term loan.

b)  Mortgage loan.

c) 

Instalment sale

agreement.

d)  Lease.

Which

ONE of the following statements is FALSE regarding

debt financing?

a)  Interest

relating to

debt financing can be deducted from taxable income

b)  Debt

requires repayment of

capital and interest

c)  The

cost of obtaining some kinds of debt is lower than the cost of issuing ordinary

shares

d)  Deb

t financing does not influence

the risk profile of an organisation

Apply your

knowledge about capital markets and select the combination of statements that

are all TRUE

(1)  A

capital market

is a financial market in which equity and longer-term debt securities are

traded

(2)  These markets

are also called

security markets and they trade in ordinary shares, preference shares, bonds

and loans that have terms of more than one year

(3)  The

Johannesburg

Stock Exchange (JSE) is an equity market and one of the divisions of the

capital market

(4)  The

capital market

is a provider of a secondary market for trading in previously issued

instruments that investors sell to one another

(5)  Large

investors,

governments and organisations can invest their surplus funds on the capital

market

(a)  Statements (1), (2) and (4)

(b) 

Statements (2), (3), (4) and

(5)

(c)  

Statements

(1), (2), (3) and (5)

(d) 

Statements (1), (2), (3), (4)

and (5)

Select which combination of the actions stated below

are all correct as examples of sustainability for businesses.

(1) 

Recycling and eliminating

waste.

(2) 

Saving costs by cutting

spending on safety equipment.

(3) 

Converting harmful gases into

clean energy.

(4) 

Approving salary increases only

for management and not for other employees.

(a)  Statements (1), (2) and (3)

(b)  Statements (1), (2) and (4)

(c)   Statements (1), (3) and (4)

(d)  Statements (1), and (3)

Select

the action from the options below that will NOT apply to a secondary external

stakeholder group attempting to influence the strategy of an organisation.

(a) 

(b) 

(c)  

An increase of the interest

rate on a loan agreement or denial of credit to an organisation when a specific

organisation does not comply to their loan agreement due to cash flow constraints.

(d)  

An increase in the allowable tax deduction granted

for installing solar energy systems by households and industries.

Your Financial

Management lecturer made the following statement: “The annual return on an

investment should not be used as overall objective to be pursued by a business”.

(a) 

(b) 

(c)  

A-Z Garden Equipment (Pty) Ltd needs further financing to

expand their operations. 

(a)  Borrowing money from their bank.

(b)  Retaining their operating cash flow.

(c)  Borrowing from their creditors.

(d)  Borrowing money from a financial institution.

Identify which of t

he following statements about the issue of ordinary

preference shares can be regarded as advantages to the organisation

(1) 

The control of the

organisation

(2)  Ordinary preference shares

present a lower

risk to lenders/investors and the lenders/investors therefore require a lower

return

(3)  Financial leverage

will reduce as

the number of ordinary preference shares (classified as equity) increases

without bringing about dilution for the average shareholders

(4) 

Due to withholding tax on

dividends, the company that issued the shares does not pay tax on the dividends

that were declared and paid.

(a)  Statements (1), (2) and (3)

(b)  Statements (1), (2) and (4)

(c)  

Statements

(2), (3), and (4)

(d) 

Statements (1), (2), (3) and

(4)

A

factor in the internal environment of the organisation that has an influence on

the development of their strategy involves the driver of perceptions, attitudes

and behaviour of employees that influence business results.

(a)  Human resource policies

(b) 

Corporate

culture

(c)  

Organisation

leadership

(d)  Industrial relations